It had the same issue when being in my second season. The match put me to level 3, make the best of it and collect some money (prices per match and and end season placing bonuses are significant higher). When I got promoted (won the league, but it was the toughest season so far), the game put me again in level 3.

If I remember correctly you should be able to buy 7* players in the scout section, while the normal transfer auctions show players for your manager (not league) level.